AT A GLANCE
Packaged Terminal Air-conditioning
Hospitality Property Managers
SIZE OF AUDIENCE
More than doubled marketshare from 9% to 24% in only four years
Annual incremental sales lift
Units sold annually
Of total market sales converted to factory direct
Every major manufacturer has core products that receive the most attention and share of budget. A widely known $6 billion dollar national air-conditioning manufacturer also possessed non-core products that accounted for less than $50 million—less than 1% of total revenue. Because of this, the division was largely ignored within the existing sales process, despite its great sales potential.
The existing sales channel had been working well for these non-core products during periods of strong economic growth. However, when the market changed from construction to replacement, dealers had no interest in selling one off replacements that generated little sales revenue. The challenge was to develop a factory direct sales and logistics model to reverse a sharp decline in sales (mid-twenties to less than 10% in just four years).
The solution was to re-engineer the sales and marketing process to match the market dynamics that this division had to compete in. A direct marketing approach that identified the universe of buyers, the life cycle of the product, when buyers would be ready to purchase, and how to target these buyers most effectively was created.
The first step was to produce a pilot program to identify how the process would work. In the first 90 days, we were able to reaffirm the sales process, identify the size of the market, number of decision makers, number of companies who were willing to buy, how many units these companies had, and which of these units were likely to be candidates for replacement. In just three months, we established the template to move forward.
After reaching this understanding, a clear strategy was developed and an integrated communications plan designed to message the right prospects at the right time to capture their business. Ultimately, a balanced approach to sales, marketing, and database mining was developed and implemented.
The client was able to grow sales from the pilot phase to nearly 75,000 units per year over a period of four years. Despite significant increases in market share and sales from $25 million to over $42 million, distribution wasn't cannibalized; the distributor volume stayed constant, providing benefits on both sides of the sales ecosystem.